As 2024 wraps up, all eyes are on the 2025 housing market forecast. Whether you're planning to buy your first home, sell a property, or continue renting, understanding what lies ahead can help you make informed decisions. Based on insights from Realtor.com, Redfin, and other industry experts, here’s what you can expect.
Home Prices Will Continue to Rise
In 2024, home prices rose by 4%, and they’re projected to increase another 3.7% in 2025, reaching new record highs. This sustained growth is fueled by a stable economy and strong demand. As Ralph McLaughlin, a senior economist at Realtor.com, points out, “Prices are going to keep rising because we’re not going to have a recession.”
For sellers, this is a golden opportunity to maximize returns. For buyers, it’s crucial to act quickly to lock in prices before they climb even higher.
Mortgage Rates: Stability Above 6%
Mortgage rates averaged 6.3% in 2024 and are expected to stay at similar levels in 2025. While this might seem high compared to historic lows, it’s worth noting that the market has adapted to these rates. Buyers should be prepared for consistent monthly payments and can benefit from programs like Best Option Mortgage’s Home 100 Down Payment Assistance Program to ease the upfront costs of homeownership.
More Homes, Less Competition
Good news for buyers: Inventory is forecasted to increase by 11.7%, giving you more choices and room for negotiation. However, this influx in supply might encourage sidelined buyers to jump back in, potentially driving up the number of home sales. Redfin estimates that 4 million homes will be sold in 2025, with sales growth ranging from 2% to 9%.
Renters Get a Break
Rents, which soared by 20% between 2020 and 2024, are expected to stabilize or even decline slightly in 2025. A construction boom that began in 2024 has brought more rental units to the market, offering renters increased options. For those considering transitioning from renting to buying, this could be the year to make the leap.
What This Means for You
Buyers: Take advantage of increased inventory and lock in your home purchase before prices rise further. With mortgage rates expected to remain stable, your monthly payment will be predictable, even if home prices climb.
Sellers: Rising prices mean 2025 could be a lucrative time to sell your property. With more homes on the market, presenting your home competitively will be key to attracting buyers.
Renters: If buying is on your horizon, this may be the perfect time to explore your options. With programs like Home 100, Best Option Mortgage can help you turn your dream of homeownership into a reality with zero down payment.
Ask the Expert: Top Home-Buying Questions Answered
1. What is the home-buying process like?
The process typically involves:
Getting pre-approved for a loan.
Partnering with a knowledgeable real estate agent.
Finding a home within your budget.
Making an offer and negotiating terms.
Closing on your dream home.
Best Option Mortgage is here to guide you every step of the way!
2. How hard is it to get a home loan?
Qualifying for a home loan depends on factors like your credit score, income, and debt-to-income ratio. Our team at Best Option Mortgage works with you to find the best loan options for your unique situation.
3. Are there down payment assistance programs available?
Absolutely! Our Home 100 Down Payment Assistance Program helps cover your entire down payment up to 5%, making it easier to afford a home.
4. Should I wait for mortgage rates to drop before buying?
Waiting could mean paying more as home prices continue to rise. Locking in now at a stable rate ensures you get the best deal before prices climb further.
5. Is buying a home still a good investment?
Yes! Real estate remains one of the most reliable investments, offering long-term wealth-building opportunities and stability compared to renting.
Your 2025 Housing Market Partner
Navigating the housing market doesn’t have to be complicated. At Best Option Mortgage, we’re here to provide expert guidance, tailored solutions, and access to programs like Home 100 Down Payment Assistance. Whether you’re buying, selling, or refinancing, we’ll help you make the best choice for your future.
📞 Ready to take the next step? Contact us today to start your journey in the 2025 housing market.
——————-
Best Option Mortgage is a DBA of ML Mortgage Corp. ML Mortgage Corp. is a state-licensed mortgage lender, NMLS ID #362312, licensed by the CA Department of Financial Protection and Innovation under the Finance Lenders Law, License #60DBO69831. For other states, visit www.mlmortgage.net. To verify licenses, visit www.nmlsconsumeraccess.org. All loans are subject to credit approval and acceptable collateral. Additional terms and conditions apply. Programs, rates, terms, and conditions may change without notice. Not all programs are available in all states. There is no guarantee that all borrowers will qualify. Restrictions may apply. This is not a commitment to lend. © 2024 ML Mortgage Corp. All rights reserved.